Eurozone PMI

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Eurozone: Flash PMI inches down in May, recovery remains on track

May 22, 2014

The flash estimate of the Markit Eurozone PMI Composite Output Index came in at 53.9 in May. The result was slightly down from the 54.0 recorded in April but was in line with market expectations. The composite PMI—the result of a survey of over 5,000 manufacturing and services businesses—has been above the 50-threshold that signals a stable economic outlook since July of last year, which suggests continued expansion in economic activity.

Despite the slight moderation, the result suggests that the recovery in the Euro area remains on track. The slowdown was mainly due to the weaker performance of the manufacturing component, which was partially compensated for by improving conditions in the services sector; the sub-index tracking service activity reached a 35-month high. While both sectors expanded capacity by taking on staff at the highest rate since September 2011, job creation remains subdued overall.

Germany’s resilient performance continues to provide support to business activity. The Germany flash composite PMI held steady at the 56.3 recorded in May. Conversely, France’s composite PMI fell from 50.5 April to 49.3 in May. Meanwhile, in the rest of the region, the composite PMI recorded the fastest rate of expansion since August 2007. According to Markit, “GDP looks set to rise by 0.5% in the second quarter after the lackluster 0.2% rise in the first three months of the year.”

FocusEconomics Consensus Forecast panelists expect the economy to expand 1.1% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, panelists expect the economy to expand 1.5%.


Author:, Head of Data Solutions

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Euro PMI May 2014 2

Note: Markit Purchasing Managers’ Index (PMI) Composite Output. A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction
Source: Eurostat


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